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Sunday, 15 October 2017

What procedure should be followed by lok adalat for passing award?

The language of the regulation is so explicit that there is no room for doubt about the role of the Lok Adalat, the nature of the award and the procedure to be followed by the Lok Adalat when a matter is settled. It can be summarised thus:

(a) The Lok Adalat only guides and assists the parties to reach a settlement or compromise.

(b) It is the duty of the Lok Adalat to ensure that the parties fully understood the terms of the settlement or compromise before it is recorded.

(c) The terms of the settlement or the compromise shall be reduced into writing.

(d) The award shall be written in regional language used in the local courts or in English. It shall contain the particulars of the case, namely, the number of the case, the name of the court, the names of the parties, date of receipt of the case by the Adalat, the number assigned to it in its permanent register and the date of the settlement.

(e) Both parties shall sign or affix their thumb impressions in it.

(f) Where the parties are represented by counsel, they shall also be required to sign the settlement.

(g) The members of the Lok Adalat shall countersign it.

(h) The document containing the terms of the settlement or compromise becomes an award when the parties sign or affix their thumb impressions in it and the members of the Lok Adalat countersign it.

To this it may be added that if there is a provision for payment of any sum, it shall be expressed in figures as well as words. [15]

IN THE HIGH COURT OF KERALA AT ERNAKULAM

O.P. (C) No. 2696 of 2015 (O)

Decided On: 18.08.2016

K.S. Sunil Vs. Sherly and Ors.

Hon'ble Judges/Coram:

K. Abraham Mathew, J.

1. Validity of three awards passed by Lok Adalat under Section 21 of the Legal Services Authorities Act 1987 on a reference made to it in three suits is under challenge.

2. The picture that emerges from the facts relating to the proceedings before the Lok Adalat, of which one of the members was a judicial officer and the other an advocate, is a mosaic of callousness, casual approach, disrespect for the statutory procedure, breach of the rules of grammar of the language and expressions which do not make any sense. It has catapulted the parties to the suits, who are members of a family, into a controversy which is worse than the one which is the cause of action for the suits.

3. The petitioner is the brother of the respondents. They and their mother, Padmavathy, had in their joint ownership 13 cents of land. In a partition that took place in 1992 five cents was allotted to the petitioner and eight cents jointly to the respondents and the mother. After the death of the mother the petitioner filed O.S. No. 2291 of 2014 in Munsiff Court, Kodungallur for partition of the right of the mother and separate allotment of his share in it. Respondents filed O.S. No. 2936 of 2014 claiming exclusive title to above said 8 cents and praying for fixation of its boundary. On the allegation that in the partition deed of 1992 some mistakes crept into the description of the properties the petitioner filed O.S. No. 165 of 2015 for rectification of the deed.

4. The disputes between the parties were referred to Lok Adalat. At the Adalat the disputes were settled and Exts P7, P8 and P9 awards were passed, which are extracted below.

"Award in O.S. No. 2936 of 2014

"Both parties present. Discussed. Matter settled. The plaintiff agreed to execute and register release deed in respect of 13 cents of property situated in Sy. No. 580/1 of Mothala village (1330/1974), in favour of defendant on a consideration of 30 lakhs. The plaintiff agreed to vacate the plaint schedule property in getting consideration and agreed to execute and register release deed or any other deed of their choice on or before 31.12.2015. Expenses for the execution shall bear the defendant. Award passed."

5. The main ground stated in this Original Petition is that it is not the terms of the compromise the parties entered into which are recorded in Ext P7 Award. It is specifically stated that the amount the petitioner agreed to pay the respondents was Rs. 13,00,000/- (Rupees Thirteen lakhs only) and not Rs. 30,00,000/- (Rupees Thirty lakhs only) as stated in Ext P6 award.

7. The function of a Lok Adalat organised under Section 19 of the Legal Services Authority Act 1987 (hereinafter called the Act) is only to help the parties to the dispute arrive at a compromise or settlement, which is seen from Section 20(3) of the Act which is extracted below:

"Where any case is referred to a Lok Adalat under sub-section (1) or where a reference has been made to it under sub-section (2), the Lok Adalat shall proceed to dispose of the case or matter and arrive at a compromise or settlement between the parties."

8. The Adalat cannot enter a finding. It can only record the compromise or settlement between the parties. Section 20(4) of the Act is relevant in this context. It runs as follows:

"Every Lok Adalat shall, while determining any reference before it under this Act, act with utmost expedition to arrive at a compromise or settlement between the parties and shall be guided by the principles of justice, equity, fair play and other legal principles."

9. Adalat cannot forgo the principles of fair play in helping the parties arrive at a compromise or settlement. The principle that it is not sufficient that justice is done but it should appear to have been done applies to the proceedings in the Lok Adalat also.

10. It is to be borne in mind that the award passed by a Lok Adalat is final. Sub sections (1) (2) and (4) of Section 22E are the relevant provisions in the Act, which are as follows:

"22E. Award of Permanent Lok Adalat to be final-(1) Every award of the Permanent Lok Adalat under this Act made either on merit or in terms of a settlement agreement shall be final and binding on all the parties thereto and on persons claiming under them.

(2) Every award of the Permanent Lok Adalat under this Act shall be deemed to be a decree of a civil court.

(3) xxxx

(4) Every award made by the Permanent Lok Adalat under this Act shall be final and shall not be called in question in any original suit, application or execution proceeding.

(5) xxxx"

11. The nature and the effect of an award passed by Lok Adalat was considered by the Supreme Court in P.T. Thomas v. Thomas Job MANU/SC/0454/2005 : (2005) 6 SCC 478 : AIR 2005 SC 3575). The apex court has observed:

"The Lok Adalat shall proceed and dispose of cases and arrive at a compromise or settlement by following legal principles, equity and natural justice. In a Lok Adalat award the endeavor is only to see that the disputes are narrowed down and make the final settlement so that the parties are not again driven to further litigation or any dispute. Though the award of a Lok Adalat is not the result of a contest on merits, just as a regular suit by a court in a regular trial is, however, it is as equal and on a par with a decree on compromise and will have the same binding effect and be conclusive. The award passed by the Lok Adalat is the decision of the court itself though arrived at by the simpler method of conciliation instead of the process of arguments in court. The effect is the same. The award of Lok Adalat is final and permanent which is equivalent to a decree executable, and the same is an ending to the litigation among the parties."

12. When the award cannot be challenged in a suit or execution proceedings or even in appeal the Lok Adalat should make sure that its proceedings are transparent and not vitiated by procedural illegalities or irregularities. Its proceedings should inspire confidence in the public, failing which the very existence of the institution will be at peril. To ensure its credibility, Lok Adalat shall comply with the procedure prescribed by the statues scrupulously.

13. In exercise of the powers given to it, the National Legal Services Authority, which is the central authority, constituted under a Section 3 of the Act has made the National Legal Services Authority (Lok Adalats) Regulations, 2009.

14. Regulation No. 17, which is relevant, runs thus:

"17. Award-(1) Drawing up of the award is merely an administrative act by incorporating the terms of settlement or compromise agreed by the parties under the guidance and assistance from Lok Adalat.

(2) When both parties sign or affix their thumb impression and the members of the Lok Adalat countersign it, it becomes an award (see a specimen at Appendix I). Every award of the Lok Adalat shall be categorical and lucid and shall be written in regional language used in the local courts or in English. It shall also contain particulars of the case, viz., case number, name of court and names of parties, date of receipt, register number assigned to the case in the permanent register (maintained as provided under regulation 20) and date of settlement. Wherever the parties are represented by counsel, they should also be required to sign the settlement or award before the members of the Lok Adalat affix their signature.

(3) xxxx

(4) xxxx

(5). Member of the Lok Adalat shall ensure that the parties affix their signatures only after fully understanding the terms of settlement arrived at and recorded. The members of the Lok Adalat shall also satisfy themselves about the following before affixing their signatures:--

(a) that the terms of settlement are not unreasonable or illegal or one-sided; and

(b) that the parties have entered into the settlement voluntarily and not on account of any threat, coercion or undue influence."

15. The language of the regulation is so explicit that there is no room for doubt about the role of the Lok Adalat, the nature of the award and the procedure to be followed by the Lok Adalat when a matter is settled. It can be summarised thus:

"(a) The Lok Adalat only guides and assists the parties to reach a settlement or compromise.

(b) It is the duty of the Lok Adalat to ensure that the parties fully understood the terms of the settlement or compromise before it is recorded.

(c) The terms of the settlement or the compromise shall be reduced into writing.

(d) The award shall be written in regional language used in the local courts or in English. It shall contain the particulars of the case, namely, the number of the case, the name of the court, the names of the parties, date of receipt of the case by the Adalat, the number assigned to it in its permanent register and the date of the settlement.

(e) Both parties shall sign or affix their thumb impressions in it.

(f) Where the parties are represented by counsel, they shall also be required to sign the settlement.

(g) The members of the Lok Adalat shall countersign it.

(h) The document containing the terms of the settlement or compromise becomes an award when the parties sign or affix their thumb impressions in it and the members of the Lok Adalat counter sign it."

To this it may be added that if there is a provision for payment of any sum, it shall be expressed in figures as well as words.

16. Ext P7 award has two sheets. The first one is a printed form. Apart from the signatures of the members of the Lok Adalat three signatures appear on it. The identity of the persons who put the signatures is not shown in it. But it is admitted that they are the parties to the suit. The judicial officer and the advocate who were the members of the Lok Adalat have put their signatures below the signatures of the parties. It may be mentioned that even the name of the judicial officer is not correctly written. The signature of the counsel of any of the parties is not seen anywhere. No part of the settlement appears on this sheet. Even the names of all the parties to the proceedings are not mentioned but, only of one of the plaintiffs, and of the defendant; nor their addresses.

17. The terms of the settlement allegedly made by the parties are contained in the second sheet. Apparently, this is an independent document. It is a type written one. There are several corrections made in ink. Though there are two plaintiffs, singular is used as if there is only one plaintiff. The parties have not put their signatures in this sheet, nor their counsel. It bears only the signatures of the judicial officer and the advocate who constituted the Lok Adalat. The amount which the petitioner is shown to have agreed to pay is not given in words, but only in figures.

18. I have no doubt that this is not a solitary incident. I came across an award passed by Lok Adalat in which the parties came to an 'agreement' with regard to an amount payable by one of the parties to the other. But the amount was not shown in the award, nor the means to ascertain it. A division bench of this court in Rajagopala Rao G.K. and another v. State Police Chief and Others (MANU/KE/0856/2016 : 2016(3) KHC 917) took a serious note of similar irregularities committed by another Lok Adalat. The division bench held:

"But we stumbled across a glaring illegality in the manner in which the earlier civil proceedings between the contesting parties were handled in a Lok Adalath constituted under the Legal Services Authorities Act, 1987 (in short, "the Act"). We are terribly disturbed by the fact that vagueness in the terms of settlement arrived at between the parties (that too relatives) in a Lok Adalath is the root cause for the subsequent disputes between them. Even now they are unable to harmonise their relationship and restore cordiality. If anybody blames the handlers of the Lok Adalath for prolonged agony of the parties, no one will be able to defend them for palpable reasons."

The division bench has directed that Lok Adalats shall see that the awards passed "are not only legal, but also confirming to the norms prescribed for a decree with all the required details in clear and explicit terms".

19. About more than one century ago in Taylor v. Taylor (1875)1 Ch D 426) it was held that where a power is given to do a certain thing in a certain way the thing must be done in that way or not at all and other methods of performance are necessarily forbidden. This rule was approved by the Privy Council in Nazir Ahmad v King Emperor (MANU/PR/0111/1936 : AIR 1936 PC 253(2) and has been followed by the Supreme Court in State of Gujarat v. Santilal (MANU/SC/0063/1969 : AIR 1969 SC 634), Kashmir University v. Mohammed Yasin (MANU/SC/0406/1973 : AIR 1974 SC 238), Ramchandra Keshav Adke (Dead) by Lrs. v. Govind Joti Chavare and others (MANU/SC/0511/1975 : AIR 1975 SC 915) and Sampuran Singh v. State of Punjab(MANU/SC/0102/1982 : AIR 1982 SC 1407) and by this court in Lakshmikutty Amma v. Vijayalakshmikutty (MANU/KE/0588/1992 : 1992 (2) KLT 341).

20. Regulation 17 (supra) requires that the award shall be in writing and both parties shall sign it or affix their thumb impressions in it. This is a provision similar to the one contained in Order 23 Rule 3 C.P.C, which also directs that the compromise shall be in writing and signed by the parties.

21. In Gurpreet Singh v. Chatur Bhuj Goel (MANU/SC/0032/1987 : AIR 1988 SC 400) the Supreme Court held that the direction that the agreement should be reduced into writing and signed by the parties cannot be dispensed with. If this requirement is not met, the court shall proceed with the matter as if there is no compromise. The object of the provision is to prevent false and frivolous pleas that a suit has been adjusted wholly or in part by a lawful agreement or compromise, the apex court has observed. In K. Venkatachala Bhat and another v. Krishna Nayak (MANU/SC/0192/2005 : JT 2005 (3) SC 161) the Supreme Court held that the effect of Order 23 Rule 2 C.P.C is that if the compromise is not signed by the parties, it cannot be recorded by the court.

22. The discussion made above compels me to hold that Ext P7 is not an award passed by the Lok Adalat in the eye of law since there is no means to ascertain whether the petitioner agreed to the terms recorded in it, which is the result of violation of mandatory provisions in the relevant statutes. Consequently, Exts P8 and P9 are also invalid. The trial court shall take up the suits and proceed with their trial. But if the parties want to refer the dispute to Lok Adalat again, the court shall comply with the request.

In the result, this Petition is allowed. Exts P7, P8 and P9 awards are declared invalid. The trial court is directed to take up the suits and proceed with their trial. But if the parties want to refer the dispute to Lok Adalat again, the court shall comply with the request.